LIVINGSTON — City Manager Richard Warne won the most recent round in a lawsuit brought by Foster Farms that accuses him of misusing city funds.
But both sides are still slinging mud at each other.
The lawsuit alleges that Warne misused city money and covered his tracks with a costly water rate increase last year, but Judge Brian McCabe of the Merced County Superior Court ruled the attorneys for Foster Farms didn't provide proof, according to Wednesday's ruling.
"They failed to show where the city violated any law or regulation or statute, and failed to provide any facts," Warne said.
The attorneys for Foster Farms took statements he and the auditor made out of context, Warne said.
Foster Farms attorneys claimed the city was improperly mixing money that must be spent on utilities with money that pays for other services.
The claim that "Warne and the city's auditor admitted improperly using the restricted funds" is "without merit," according to the ruling.
Though the ruling was in Livingston's favor, the case hasn't been dismissed. Foster Farms has the opportunity to file an amended complaint, said Livingston city attorney Jon Hobbs.
Foster Farms plans to do so by Sept. 8 in accordance with the court's request, said Randy Boyce, senior vice president and general counsel for Foster Farms.
"We think (Warne) acted outside of the law with respect to the use of funds in the city of Livingston," Boyce said. "Funds were intermingled in a general account and improperly used to pay things such as attorney fees in a fight that the city had against us in 2007." Boyce also pointed out that attorneys' fees for Livingston have shot up substantially since Warne was appointed city manager.
"I think Richard Warne is a disaster for the city of Livingston," Boyce said. "I think Richard Warne, for whatever reason, has an operating mode of using resources available to him to try and get whatever he wants through litigation and strong-arm tactics."
"Foster Farms has never had a cooperative relationship, from Day One, with Richard Warne," Boyce said. "It's as if he's declared war on Foster Farms."
Warne counters that the poultry producer is at the root of the rift between the city and its largest employer.
"They're the ones bringing on the lawsuits. Foster Farms has declared war against the city," he said. "The city's constantly had to defend itself against frivolous lawsuits brought on by Foster Farms and others."
Warne said there are several people looking over his shoulder to ensure all finances are handled properly.
"The city's financial statements and accounting procedures are audited every year by an independent, certified, outside auditor," Warne said. "They have consistently said that the city has handled the funds properly in accordance with the law. The public can have confidence."
Foster Farms has another lawsuit challenging Livingston's 2009 water rate increases. McCabe sided with the company in that case, but it is under appeal.